New Jersey's sales tax rate and what it covers
New Jersey charges a 6.625% sales tax on most goods and services you buy in the state. This is a single statewide rate — it does not vary by county or municipality the way property taxes do. When you buy something at a store, online from a New Jersey seller, or from a service provider, that percentage is added to your bill at checkout.
The tax applies to tangible items (clothing, electronics, furniture) and to many services (haircuts, repairs, dry cleaning). Some categories are taxed differently or not at all. Food you buy at a grocery store to cook at home is not taxed. Prepared food — a sandwich from a deli, a meal at a restaurant — is taxed. Medicine prescribed by a doctor is not taxed, but over-the-counter drugs and vitamins are.
If you buy something online from an out-of-state seller and have it shipped to New Jersey, you may owe sales tax depending on whether that seller has a physical presence or employees in New Jersey. Many large retailers now collect New Jersey sales tax on all orders shipped here, even if they are based elsewhere.
Key Takeaways
- New Jersey's sales tax rate is 6.625% statewide, with no local additions on top of that rate.
- Grocery food is not taxed, but restaurant meals, prepared foods, and takeout are taxed at the full rate.
- Prescription medications are exempt, but over-the-counter drugs, vitamins, and supplements are taxed.
- Clothing and footwear under $110 per item are not taxed; items over that threshold are taxed in full.
- Services like haircuts, repairs, and dry cleaning are taxed, but professional services like accounting or legal advice are generally not.
What is and is not taxed in New Jersey
Understanding which purchases are taxed helps you predict what you will actually pay. Clothing and footwear have a special rule: items priced under $110 are not taxed, but if a single item costs $110 or more, the entire purchase is taxed. A $100 shirt is tax-free. A $150 coat is taxed on the full $150. This applies to each item separately, not to your total receipt.
Utilities — electricity, gas, water — are taxed at a lower rate of 4% instead of 6.625%. Gasoline and diesel fuel are not subject to sales tax, though they carry a separate motor fuels tax. Newspapers and magazines are not taxed. Admission to movies, concerts, and sporting events is taxed. Gym memberships and personal training are taxed.
Real estate transactions, including the sale of a house or land, are not subject to sales tax (though they are subject to transfer tax, which is different). Insurance premiums are not taxed. Rent is not taxed. Childcare services are not taxed, but babysitting by an individual is generally not taxed either — it depends on whether the person is operating as a business.
How sales tax is collected and who pays it
The seller — the store, restaurant, or service provider — is responsible for collecting sales tax from you and sending it to the New Jersey Division of Taxation. You do not send the tax directly to the state. The seller adds it to your bill, collects it from you, and remits it monthly or quarterly depending on their sales volume.
If a seller fails to collect tax or collects it but does not send it to the state, you are not liable for that unpaid tax as a customer. The seller is responsible. However, if you are self-employed or run a business, you may owe sales tax on services you provide, and you will need to register with the state and file returns.
When you buy from an online retailer, the same rule applies: the retailer collects the tax and sends it to New Jersey. If you buy from someone outside the United States or from a seller with no connection to New Jersey, sales tax may not be collected, though New Jersey law technically requires you to pay a "use tax" on such purchases — in practice, this is rarely enforced for individual consumers.
Sales tax on specific categories you may wonder about
Pet food and pet supplies are taxed. Pet grooming services are taxed. Veterinary services are not taxed. Plants and seeds for planting are not taxed, but potted plants and flowers are taxed. Firewood is taxed. Propane and heating oil are taxed.
Tickets to museums, zoos, and amusement parks are taxed. Parking fees are taxed. Tolls are not taxed. Rental cars are taxed. Hotel rooms are taxed. Camping fees are taxed. Boat rentals are taxed.
Haircuts and salon services are taxed. Tattoos and piercings are taxed. Massage therapy is taxed. Dental services are not taxed. Medical devices prescribed by a doctor are not taxed. Eyeglasses and contact lenses are taxed.
How to find the tax amount before you buy
Most retailers display the tax amount separately on your receipt so you can see exactly what you paid. Online retailers typically show the tax before you complete your purchase, so you know the final total before you enter payment information. If you are buying something expensive and want to calculate the tax yourself, multiply the price by 0.06625.
For items near the $110 clothing threshold, ask the cashier or check the price tag to confirm whether the item is subject to tax. Some retailers may not be familiar with this rule, so it is worth verifying if the difference matters to your budget.
If you are buying something and are unsure whether it is taxed, you can contact the New Jersey Division of Taxation directly or check their website for a detailed list of taxable and non-taxable items. Many common questions are answered in their published guidance.
Sales tax on services and repairs
Labor and repair services are generally taxed. If you pay someone to fix your car, repair your home, or fix your appliance, the labor portion of the bill is taxed. The parts may or may not be taxed depending on whether they are considered tangible goods or part of the service. When you receive a repair bill, the tax should be itemized so you can see what portion is labor and what portion is parts.
Installation services are taxed. If you buy a water heater and pay for installation, both the product and the installation labor are taxed. If you buy flooring and pay for installation, the flooring is taxed and the installation is taxed. Some contractors bundle these together; others itemize them separately.
Consulting and professional advice — from an accountant, lawyer, or engineer — are generally not taxed. However, if that professional also provides tangible goods or performs labor that is considered a service, that portion may be taxed. The distinction can be unclear, so ask your service provider if you are unsure.
Frequently Asked Questions
Do I pay sales tax on online orders shipped to New Jersey?
Yes, if the seller collects it. Most major online retailers now collect New Jersey sales tax on orders shipped to the state. If a seller does not collect it at checkout, you are technically supposed to pay a use tax when you file your state income tax return, though this is rarely enforced for individual purchases. Check your receipt to see if tax was charged.
Is there a sales tax on groceries?
No. Food you buy at a grocery store to prepare and eat at home is not taxed. This includes bread, milk, vegetables, meat, frozen dinners, and canned goods. However, prepared foods — deli sandwiches, hot pizza, rotisserie chicken, items from a salad bar — are taxed. The line is whether the food is ready to eat or requires preparation.
What if I buy clothing that costs exactly $110?
Items priced at $110 or more are taxed. So a $110 item is taxed on the full $110. The exemption applies only to items priced under $110. If an item is $109.99, it is not taxed. If it is $110.00, it is taxed.
Do I owe sales tax on used items I buy from a private person?
No. Sales tax applies to sales by retailers and businesses. If you buy a used car, furniture, or clothing from a private individual, there is no sales tax. If you buy from a used goods store or reseller that operates as a business, sales tax applies.
Are streaming services like Netflix or Spotify taxed in New Jersey?
Yes. Subscriptions to streaming services, software, and digital content are taxed at the full 6.625% rate. This includes music streaming, video streaming, cloud storage, and online games. The tax is added to your subscription bill.